Making sure the price is right puts data at heart of insurance
Zurich Insurance made the news for a data management error. But behind the scenes, the company is undergoing a major change in the way it drives the whole business using data, as Gordon Wilmott explains to David Reed.
Fines imposed by regulators may be headline news. But they are not the stuff of day-to-day work for data practitioners. As Gordon Wilmott, head of data, analytics and planning at Zurich Connect UK makes clear, his job is about “applied data” - putting data assets to work to drive the business forward.
Ensuring compliance is part of that, of course. “We have got a very tough regulatory environment which we have to adhere to” he notes. But that is probably not the most difficult aspect of current market conditions.
“For us, the difficult thing at the moment is losing control over effective demand generation. With the rise of price comparison websites, marketing for financial services companies will change,” says Wilmott.
Global brand marketing will continue to be vital in order to gain consideration and build consumer trust at the point of getting a quote. Early stages in the relationship up to the point of conversion are increasingly outside of the brand owner’s control, however.
What that shift does is place more emphasis on data-driven marketing to feed the prospecting channel and from the moment a prospect becomes a customer. “The challenges for me are about effective management of the customer data strategy and customer management framework,” he says.
Core to this is ensuring that the work of data analysts adds value throughout the customer lifecycle and in every channel. “We have to look at two issues - cost per acquisition and propensity for cross and up-selling,” says Wilmott.
While optimising customer acquisition marketing and then maximising margins from policy holders has long been at the heart of insurance data management, the parameters of Wilmott’s work have been expanded by this changing market. Insights from customer data are now being used across the organisation to understand the impact of channels on value and customer outcomes, for example.
“Our goal in that context is to deploy insight more generally. As part of that, we need to ensure our IT colleagues build systems to allow that knowledge into the pricing department or to drive web site propositions,” he says.
He says: “It is almost as though the four Ps are being adopted by non-marketing functions, too, for example, my pricing colleagues. In traditional financial services companies, pricing has been the sole remit of that function, with marketing concerned with promotions and product, while place is determined by direct marketing or distribution. The assumption now is that the four Ps are owned by everybody and that is breaking down traditional divisions between functions.”
Wilmott’s own career path and skills set suit him perfectly to this wide-ranging remit. With a degree in business administration, his first job was in marketing planning and execution as marketing controller for Royal & Sun Alliance. Adding to his skills through qualifications from the Institute of Direct Marketing, he joined Zurich in 2003 in a communications planning role.
“I quickly realised that I had a strong belief in the principles of direct and data-driven marketing - seeing the commercial possibilities that surrounded the effective use of data to drive business strategy and customer outcomes,” he recalls.
Key performance indicators for his job cover organisational measures like income and new business volumes through customer metrics to granular platform metrics, says Wilmott: “My ultimate business goals are revenue growth and expense management - identifying ways and means to set and achieve appropriate targets.”
Data is valued at Zurich as a major enabler for the business with a strong commitment to best practice around data governance as well as investment into capability projects. Current objectives include future-proofing customer marketing by ensuring the right people, processes and technology are in place.
As well as internal resources, Zurich makes use of third-party suppliers, notably SkyIQ which supplies the Elements platform for campaign execution. Prospecting data is drawn from Experian’s National Canvasse.
While the resources available to deliver against his expanded agenda are improving all the time, Wilmott points out that, “a key challenge, for both clients and suppliers, remains how to make sense of the staggering amounts of data that continues to be available on active and prospective customers.” With data central to driving Zurich’s business, it is a challenge he is more than able to meet.